KARACHI: The Pakistan Stock Exchange (PSX) ended the week on a historic high, with the benchmark KSE-100 index closing at 141,035 points — up 1,828 points (+1.3% week-on-week). The rally, driven by oil and export-oriented stocks, came amid renewed optimism over a fresh US-Pakistan trade deal that promises tariff cuts and increased investment.
The upbeat sentiment persisted despite July inflation climbing to 4.1% year-on-year from 3.2% in June. The State Bank of Pakistan (SBP) kept its policy rate unchanged at 11%, while the rupee gained 0.3% to settle at 282.72 against the US dollar. SBP reserves, however, slipped by $153 million to $14.3 billion.
On the fiscal front, the Federal Board of Revenue exceeded its July collection target, pulling in Rs754 billion — up 14% from last year. Meanwhile, petrol prices dropped Rs7.54 per litre, while high-speed diesel rose Rs1.48/litre from August 1.
Volatile Trading Week
The week began with the index struggling to cross the 140,000 barrier, ending Monday at 139,380 points. Heavy profit-taking ahead of the SBP’s policy decision dragged the market down to 137,965 on Tuesday.
On Wednesday, the SBP’s decision to hold rates sparked an initial dip to 137,659, but renewed buying in banking stocks lifted the index to 138,412. Thursday saw wild swings — the market touched an intra-day high of 140,215 before closing at 139,390.
The breakthrough came on Friday as energy stocks surged on news of potential US collaboration in oil exploration and expectations of circular debt payments next week. The index jumped 1,645 points to close at an all-time high of 141,035, after briefly touching 141,161.
Analysts’ Take
Arif Habib Limited credited the rally to optimism over the US-Pakistan trade pact, which will cut tariffs on Pakistani goods to 19% from the previously announced 29% in April 2025, effective August 2025.
JS Global’s Syed Danyal Hussain noted that after a choppy start, the market’s strong rebound in the final sessions was led by oil stocks, with average daily turnover easing 12% from last week.
With the results season in full swing and valuations still attractive, analysts expect sentiment to stay positive in the coming days.
